Perils and Pitfalls of Merger Negotiations

A decade and a half ago, I stood in the crowded main conference room of Maryland third largest law firm. Earlier that Monday morning, driving into work, NPR blared on my radio the news that the partners of the firm had convened an unheard of Sunday shareholders' meeting - and voted to dissolve the 140 year old firm.

In cemeteries throughout Maryland, the skeletal remains of attorneys long gone rolled over in their graves.

It would take days before I realized how much orchestration, how much conniving, how many smoky back room deals must have been cut over the preceding months, and how much backstabbing must have occurred in order for that vote to have even taken place. And to have the news broadcast throughout the greater metropolitan DC area less than 12 hours after the vote - with only a Sunday night intervening? Well, that just defines the breadth and depth of the planning.

Standing in that conference room, the office's managing partner assured us that - as an office - we had merge into the firm just two years earlier as a whole - and we would simply merge ourselves into another firm as a whole. No one left behind. Take us as a whole or not at all. Noble words - but demonstrative of the dangerously naive business sense most attorneys carry with them.

The core group of rainmakers began negotiating with other mega-firms in the area. Their noble words turned to empty deeds when the negotiating committee cut a deal for themselves only - leaving everyone else in the lurch. It all comes down to self preservation - and when forced to make a decision at the negotiating table between saving themselves or holding out more a more inclusive deal, the rainmakers justify their survival-of-the-fittest Darwinian decision by convincing themselves that they have already taken care of their employees by providing years of prior work - and that it's simply time for them to leave the nest and fly away.

I was one of 5 who helped dissolve and liquidate the firm - and 'twas not a pretty sight. A lot of butt-hurt people whose years of loyalty to the rainmakers bought them nothing but COBRA rights.

Now, it's deja vu all over again. My existing firm is in merger negotiations - and even before it begins in earnest, the Darwinian mentality is seeping through - despite the reminiscent speech to the masses that we will only merge if we can bring the whole firm along.

Riiiiggggghhhhht.

Security - and How One Young Marine Brought a Battalion to Its Knees

The Marine Corps tests the readiness of its infantry units before they are are permitted to deploy around the globe. Typically, the test measures the unit's ability to locate, close with and destroy a smaller, counter-insurgency sized force. The ratio is somewhere in the neighborhood of 50 aggressors against a battalion of 1500 Marines. The aggressors are selected from a separate unit - which takes pride in inflicting mock casualties on the unit being tested.

On the one occasion I was selected to be an aggressor, we actually came to "blows" in combat town - a good old fashioned bared knuckled brawl in the middle of a combat town. During the same exercise, I hit a tank turret with an M-203 grenade (spewing dayglow orange dye instead of white phosphorous). The tank commander whipped his M-1 Abrams straight towards us - plowing down saplings to reach us - and, but for the speed of our Humvee - I'm certain we would have come to blows with them as well. The point is - both sides took their roles VERY seriously.

There is a Marine Corps legend of a young PFC (Private First Class) who was selected to be a member of the aggressing unit. On his own initiative, the young PFC spent the weekend prior to the exercise rummaging through the battalion's dipsy dumpster. As a member of the aggressing unit, he was able to walk away with map overlays, memos, radio frequencies, call signs, every aspect of the battalion's battle plan for the upcoming test. When the exercise began - it was a slaughter. The command and control of the battalion was neutralized almost immediately. The counter insurgency unit used the radios, frequencies and call signs to wreak utter havoc on what remained of the battalion - having one company launch mock mortars against another company in the same battalion. Masterful.

It was possible because one young, ambitious Marine recognized that one man's trash is another man's treasure. He walked away with another stripe on his sleeve.

How far do you think an unscrupulous attorney might go to win millions for his client? How safe is your trash? How safe is your network? How loyal are your employees?

Don't think espionage happens in law firms? One day, a battalion of Marines never thought they could be brought to their knees by a young PFC and his trash bag.